Income Taxes

12 Months Ended

Dec. 31, 2019

Income Taxes

Income Taxes

NOTE 10 - INCOME TAXES

A reconciliation of the provision for income taxes at the United States federal statutory rate compared to the Company’s income tax 

expense as reported is as follows:

	2019			2018
Net loss before income taxes per consolidated financial statements	$	(5,676,436	)	$	(8,096,408	)
Income tax rate		21	%		21	%
Income tax recovery		(1,192,100	)		(1,700,300	)
Non-deductible share-based payments		566,600			662,800
Non-deductible interest		33,200			22,800
Loss on settlement of debt		293,600			732,600
Initial derivative expense		57,700			—
Change in fair value of derivative expense		30,000			—
Valuation allowance change		211,000			282,100
Income tax expense (recovery)	$	—		$	—

The significant component of deferred income tax assets at December 31, 2019 and 2018 is as follows:

	2019			2018
Net operating loss carry-forward	$	799,900		$	588,900
Valuation allowance		(799,900	)		(588,900	)
Net deferred income tax asset	$	—		$	—

The amount taken into income as deferred income tax assets must reflect that portion of the income tax loss carry forwards that is more likely-than-not to be realized from future operations. The Company has chosen to provide a full valuation allowance against all available income tax loss carry forwards. The Company has recognized a valuation allowance for the deferred income tax asset since the Company cannot be assured that it is more likely than not that such benefit will be utilized in future years. The valuation allowance is reviewed annually. When circumstances change and which cause a change in management’s judgment about the realizability of deferred income tax assets, the impact of the change on the valuation allowance is generally reflected in current income.

As of December 31, 2019 and 2018 the Company has no unrecognized income tax benefits. The Company’s policy for classifying interest and penalties associated with unrecognized income tax benefits is to include such items as tax expense. No interest or penalties have been recorded during the year ended December 31, 2019 and 2018 and no interest or penalties have been accrued as of December 31, 2019 and 2018. As of December 31, 2019 and 2018, the Company did not have any amounts recorded pertaining to uncertain tax positions.

The tax years from 2009 and forward remain open to examination by federal and state authorities due to net operating loss and credit carryforwards. The Company is currently not under examination by the Internal Revenue Service or any other taxing authorities.